Further Room To The Downside

Wednesday, February 1, 2017
What To Do?
Short Term
Short-term bears should hold original short positions and keep stops as previously directed.
Short-term bulls should stand aside.
Intermediate & Long Term:
Intermediate and long term positions to the upside should be maintained.
There are no intermediate or long term opportunities to the downside.
Market Trends:
Intra-day: Down
Short Term: Neutral
Intermediate Term: Up
Long Term: Neutral
The stock market, as measured by the Wyckoff Wave opened higher today, and then reversed lower to go minus on the day, and then rallied for the last half of the day to close slightly higher on the session.  Volume was unchanged from yesterday.  The price spread and volume showed a stand off in today’s trading.
The Technometer is registering a neutral reading.
The Nasdaq was up .5% today while the S&P 500 was unchanged.

A review of the intra-day waves shows the Wave trading around unchanged today on average volume.  Nothing new to report here.
The Optimism-Pessimism Index closed unchanged today.
The Force Index closed slightly lower today.  The Force index is at -180 which is applying downside pressure on the Wyckoff Wave and should keep us in reaction mode.
On Thursday, the Technometer will open in a neutral reading once again.

The last five days, the Wave has been slowly working lower from the resistance at the top of the trading range.   Volume has been lackluster and volatility low.  We would expect this to change, and for the reaction to continue to the downside.

Good Trading,
Todd Butterfield